Credit Suisse largest shareholder: Market panic is 'absurd'

The Saudi National Bank (SNB) said the market panic over Credit Suisse was "absurd".

Credit Suisse shares fell sharply on March 15 after it was announced that SNB would not provide additional financial support for this bank. To stabilize the situation, Credit Suisse had to ask for help from the Swiss Central Bank.

Regarding this, speaking on March 16, SNB President Ammar Al Khudairy said: "Unfortunately many people are just looking for reasons for the drop. This is panic. I believe panic. This is completely irrelevant, whether about Credit Suisse or the market as a whole."

He added that the collapse of Silicon Valley Bank (SVB) is far from the 2008 financial crisis. At the same time, the Chairman of SNB said that the bold moves of the US authorities have prevented the risk of contagion.

"It is true that we had a crash last week, but this is far from the 2008 crisis. This is just an isolated case, the US authorities have contained the risk of contagion," he said.

At the same time, Mr. Ammar Al Khudairy said that Credit Suisse did not ask SNB for financial support.

“Currently Credit Suisse has not discussed with SNB about financial support,” he said. "I don't know where the term 'support' comes from, there hasn't been any discussion about it since October 2022."

He emphasized that SNB will not raise its ownership above the 10% threshold. “The message has remained unchanged since October 2022.

Even if we wanted to, the injection of more capital has too many complicated hurdles from regulation and compliance,” he said. Currently, SNB's shareholding ratio in Credit Suisse is at 9.9%.

Previously, after the announcement that it could not raise shares more than 10% due to the legal regulations of the Saudi Arabian national investment fund, Credit Suisse bank shares witnessed a record plunge in the trading session on March 15. The stock fell 24.2%, to less than 2 Swiss francs ($2.18) per share.

However, at the opening session of this morning, Credit Suisse shares jumped 30% thanks to the news of a $ 54 billion loan from the Swiss Central Bank.

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